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Experimentation in a Duopoly

Author

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  • Fishman, A.
  • Gandal, N.

Abstract

The existing literature on optimal learning confines attention to the costs and benefits of experimentation when there is a single decision maker. In this paper, we consider equilibrium learning in an imperfectly competitive setting. The novel feature of the competitive setting is that experimentation involves strategic costs that are not present in the monopoly context. Using a simple model, we show that competition can inhibit the scope of learning, relative to a monopoly.
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Suggested Citation

  • Fishman, A. & Gandal, N., 1992. "Experimentation in a Duopoly," Papers 7-92, Tel Aviv.
    • Handle: RePEc:fth:teavfo:7-92
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